Financial tips for first time retailers
Financial tips for first time retailers: Have you recently turned your business dreams into a reality? You’re not alone, in fact, there were over 25,000 new start-ups within Ireland alone in 2021, according to CRIF Vision-net’s latest report.
In getting started, the hard part is done. Now is the time to start focusing on your business strategy and strengthening your business’s future. Finance and resource planning is key, but creating that plan can feel overwhelming when you are new to business.
Here are a few of our top tips to help you get focused on your finances.
Write it down
The first step to accomplishing your financial goals is by writing everything down. What do you want to achieve? Where would you like your business to be in a year’s time, or in five years’ time? How will you go about reaching those targets?
Writing down your goals not only gives you clarity, but you are also making a commitment to seeing them through.
Make sure that your written goals are specific and achievable, and give yourself a time frame in which to complete them. For example, if you would like to clear an old balance from your business credit card, make that your specific goal, and then calculate a realistic time frame that will allow you to complete the task.
Regularly review and update your list of goals. There’s a real sense of achievement when you can mark something off that list as complete, it allows you to measure your success and congratulate yourself on your ongoing achievements. Additionally, your goals and strategies might change over time. Intermittent reviews will help you to keep track, adapt, and adjust your strategy.
Keep an emergency fund
Factor in a reserve fund for unforeseen events, and don’t be tempted to spend it on anything that isn’t a genuine emergency. You might be glad of it if you run into a short-term cash flow issue.
If you can manage it, aim for two months’ payroll, but you should have at least one month as a minimum.
Invest in product research
Product research allows you to gauge, and potentially forecast, the demand for particular products.
In retail, it’s all about finding out which products your customers want, that also offer the best margins to help your business achieve its financial goals.
There are lots of ways to carry out product research, and early on in your business days you should consider using cost-effective customer research methods such as surveys, interviews, and feedback to get you started.
You’ll also need to find out what your competitors are up to and compare this to your own offerings.
Be sure to record all the data you collect for analysis and comparison, to ensure that it’s useful for your financial planning.
An EPOS system can help you to record and process your store transaction information, so that you can view daily, monthly, and eventually, year on year reports. These will help you to ensure you’re ordering the most popular and highest margin stock items.
Discover free tools and apps
There are plenty of free online tools and apps available to help business owners with financial planning.
Take some time to see what’s out there that might be useful to your specific business or sector, but here are a few general ones that we like to help get you started:
YNAB ‘You need a budget’ free budgeting app that can be used for small business.
Wave Financial app for small businesses.
Zipbooks Bookkeeping and accounts app.
Google Drive Free, shareable file storage.
Mailchimp Free email, survey, and marketing features.
Canva Create beautiful flyers, emails, and social media posts.
Trello Workflow app to manage your projects.
Bitrix24 Create to-do lists and set recurring tasks.
Invest in good software to manage your store
Set aside part of your budget to invest in good EPOS (Electronic Point of Sale) software, this will be a valuable long-term investment for your new business.
Using the right software will help you to manage your daily customer transactions, and also assist with financial planning and business strategy.
Full store management software will keep track of your inventory, set pricing, and generate useful reports, so you can see what’s selling well, what’s less successful, and where you are making profits or losses.
Find out more about EPOS for retailers here: EPOS for retailers
Have a small marketing budget
Keep a marketing budget aside. Of course, money is tight in the early days, but marketing is an ongoing investment for your business. The more people who know about you, the faster your business will flourish.
Many people get their information online now, so every business needs an online presence to build up reputation and trust.
Begin by creating free social media accounts, claim and complete your Google My Business page, and start building a customer database for mailshots. All of these things can be done early on as they won’t cost you a thing.
Once you’re established and ready to increase your reach, you can use some of your marketing budget to build your online presence with paid social media and Google advertising campaigns.
You might use your budget to create promotional materials such as posters, in-store point of sale material, or flyers. Most businesses will benefit from having created a website or webshop, and this will also come from your marketing budget.
Get feedback from your customers where you can, by asking for reviews or offering small prizes for completing a survey, or a competition. Don’t forget to monitor the results of your marketing so you can see where your budget is creating the best return on your investment.
Organise your sales and shipping strategy
It’s worth spending some time planning the logistics of your physical sales, this will be important when it comes to budgeting.
Start as you mean to go on because it can be difficult to change later on. For example, if you start out offering free shipping and later remove the offer because it isn’t finally viable, this can lead to disgruntled customers and damage to your reputation. It’s wiser to consider your options early on.
Can your business offer more than over the counter purchases, such as telephone ordering, web shop or click and collect? If so, you could stand to benefit from a far greater customer reach, and 24/7 sales opportunities.
Factors to consider include packaging, waste management, and postal/shipping services. Research all available options for your business type before committing to anything.
Who are we?
We are dedicated to providing your store with the most up-to-date and reliable point of sale hardware, along with software management tools to help you manage your business effectively.
Our self-checkout partners are NCR, which are global leaders in self-checkout technology.
To find out more about what we do, get in touch to chat with one of our knowledgeable consultants:
About the author:
Susan McGuire is originally from London, U.K., and has lived in Galway, Ireland, for 15 years. She has been with Retail Solutions for nearly 7 years, and during that time has had roles within the areas of Maintenance, Finance, & Marketing.
You can follow her on LinkedIn!